Lithuania’s defence procurement agency fined €484,000 over unlawfully signed Rukla barracks contract

Lithuania’s Infrastructure Management Agency has been fined nearly half a million euros for signing a €19.4 million contract with a construction firm that submitted forged bank guarantee documents, the state broadcaster LRT reported Tuesday.

The Kaunas Regional Court ruled on May 4 that the agency had unlawfully awarded the contract for renovating Rukla military barracks—intended for German troops—to **Consolius LT**, after the company provided a fake guarantee from the Luxembourg branch of Japan’s **Sumitomo Mitsui Trust Bank**. Despite the fraud, the court upheld the contract due to “geopolitical circumstances and international obligations,” but imposed a 2.5% penalty of the contract’s value (€484,000) for procedural violations.

The renovation must be completed by April 2028, the court stressed, as delays could outweigh the benefits of canceling the agreement.

**Forged documents and ignored warnings**
Rival bidder **Versina**, which placed second in the tender, alerted the agency after discovering discrepancies in the guarantee. The company contacted the bank and confirmed the documents were forged, including a fake power of attorney for an Italian signatory, **M. S.**, and a counterfeit ID copy of a lawyer, **A. K.**, who denied any involvement.

The agency dismissed these findings, arguing that official submissions from **Consolius LT** took precedence over **Versina**’s email correspondence with the bank. It claimed it had no obligation to verify signatures or contact the bank directly unless “objective doubts” arose—despite the forged evidence.

**Consolius LT’s defence rejected**
The winning firm argued it had no reason to suspect fraud, as its Kaunas-based insurance broker, **FT Broker**, had vetted the guarantee. It also claimed the bank had confirmed its ability to issue such guarantees in the future. However, the court found that **Consolius LT** had never signed an agreement with the bank, failed to assess its own creditworthiness, and did not disclose the bank’s terms.

The firm paid €1,800 to insurer **Draudita**, which claimed to act as the bank’s intermediary, but the court ruled this did not absolve **Consolius LT** of responsibility for submitting a document signed by an unauthorised party.

**Agency failed due diligence**
The court determined that the Infrastructure Management Agency—overseen by the **Ministry of National Defence**—should have verified **Consolius LT**’s submissions. Both the agency’s inaction and the firm’s false information were deemed unlawful.

The ministry had previously told BNS that **Consolius LT**’s bid met all tender requirements and that its documents “raised no concerns.”